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Monday, 04 April 16
THE LOADING, AND SUBSEQUENT DISCHARGE, OF UNSAFE NICKEL ORE - ALL TIME TO 'COUNT' - THE STANDARD CLUB
 KNOWLEDGE TO ELEVATE
In a recent, published, London arbitration award the English tribunal has held that all time lost as a result of loading, and then discharging, a confiscated (unsafe) cargo will be for the charterer’s account.
Background facts
Under a contract of affreightment (CoA), the owner was required to carry eight shipments of nickel ore. The ship promptly arrived at the nominated load, with loading commencing the very next day. Loading stopped two weeks later, however, and the local navy issued a confiscation order, resulting in the ship being compounded in a nearby naval base. The confiscation order was issued due to the cargo being mined outside the parameters of the locally granted permits. Only three months later was the ship released to discharge the cargo already on board the ship, which took two more months to complete.
When the ship was released the charterer emailed the owner requiring it to organise the remaining discharge operation. In addition, the charterer advised that it would not provide any cargo for the next shipment. In response, the owner advised the charterer that it had wrongfully repudiated the CoA and claimed, through London arbitration, demurrage for the entire duration of delay.
The Tribunal’s decision
The arbitration tribunal would only consider the claim for demurrage, not the claim for possible wrongful termination.
The charterer’s primary defense to the demurrage claim was based upon the following CoA clause (our emphasis):
‘In case any acts of God, riots, civil commotions, fire or any other causes comprehend in the Force Majeure terms which may delay or prevent to provide the cargo at the port of loading and load/discharge of the cargo, such time lost is not to count as laytime as neither Charterers nor Shipper nor Suppliers nor Receivers shall be liable for any loss of demurrage, unless vessel already on demurrage. Once on demurrage always on demurrage.’
The tribunal found that the above clause did not aid the charterer in its defence. It was held that the confiscation of the ship by the local navy did not fall within the boundaries of ‘any acts of God, riots, civil commotions, fire or any other causes comprehend in force majeure terms’.
Also, the tribunal found that because the subject cargo had been illegally mined, the charterer had failed to meet its primary contractual obligation under the CoA to provide a safe cargo, which could not be ‘excused’ by other contractual defences.
Finally, as the intervention by the navy was after the ship fell on demurrage, it was found that as per the above wording, ‘once on demurrage always on demurrage’, the charterer remained liable for the entire period of detention and delay.
On the other hand, the tribunal refused to accept that the charterer should not be allowed load time. This was on the basis that cargo had been partially loaded. The charterer was therefore allowed laytime, on a pro rata basis, irrespective of it being considered an unsafe cargo.
Concluding remarks
Following the above decision, members acting in a charterer’s capacity should take all precautions to ensure that the cargo to be loaded on board a ship is safe, legal and that all applicable documentation is in order to best prevent similar situations from arising in the future. It should also be noted that if the subject charter includes the phrase ‘once on demurrage, always on demurrage’ the charterer will remain liable for all time used until the load or discharge operation is completed. Charterer members should, therefore, be proactive and continue to use their best efforts to minimize any time lost.
This article intends to provide general guidance on the issues arising as a matter of English law. It is not intended to provide legal advice in relation to any specific query. Members requiring further information on this topic should direct their enquiries to either their usual contact at the club, or to the authors of this article.
Defence cover is, by its very nature, discretionary in that the club must be satisfied as to the merits and quantum of the claim in question and the likelihood of achieving a successful outcome, if it is to lend support.
Source: The Standard Club
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Monday, 30 May 16
BCI ENDING AT 830 POINTS, DOWN 4.6 PER CENT W/W
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities decline this week. The freight market was weak this past ...
Friday, 27 May 16
PET-COKE IMPORTS TO FACE PRESSURE IN INDIA
COALspot.com: An Indian environmental activist moved the National Green Tribunal seeking ban on the use of all forms of petroleum coke, also called ...
Friday, 27 May 16
US COAL PRODUCTION ROSE 2.9% WOW, ACCORDING TO EIA
COALspot.com – U.S the world’s second largest coal producer has produced approximately totaled an estimated 11.7 million short tons (mm ...
Thursday, 26 May 16
GIANT ORE CARRIERS SET TO PLAY A BIGGER ROLE IN THE GLOBAL SHIPPING FLEET: CHINA EMBRACES VALEMAXES - RICHARD SCOTT
Another phase of the giant ships era is approaching. Chinese shipowners placed orders recently for 30 huge ‘valemax’ ore carriers. Thes ...
Wednesday, 25 May 16
MEDIATION AS A WAY TO RESOLVE DISPUTES IN THE SHIPPING INDUSTRY - LANA JACOBS
KNOWLEDGE TO ELEVATE
The shipping market is currently experiencing a serious recession with the Baltic Dry Index and Baltic Capesize Index bot ...
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Showing 2416 to 2420 news of total 6871 |
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- Merrill Lynch Commodities Europe
- Singapore Mercantile Exchange
- Jindal Steel & Power Ltd - India
- Trasteel International SA, Italy
- CNBM International Corporation - China
- Kepco SPC Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Neyveli Lignite Corporation Ltd, - India
- Sojitz Corporation - Japan
- Mercator Lines Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Georgia Ports Authority, United States
- Jaiprakash Power Ventures ltd
- Grasim Industreis Ltd - India
- SMC Global Power, Philippines
- Independent Power Producers Association of India
- Chettinad Cement Corporation Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Bulk Trading Sa - Switzerland
- Vedanta Resources Plc - India
- Asmin Koalindo Tuhup - Indonesia
- Commonwealth Bank - Australia
- Antam Resourcindo - Indonesia
- LBH Netherlands Bv - Netherlands
- The State Trading Corporation of India Ltd
- GAC Shipping (India) Pvt Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coalindo Energy - Indonesia
- Edison Trading Spa - Italy
- Iligan Light & Power Inc, Philippines
- Star Paper Mills Limited - India
- Kaltim Prima Coal - Indonesia
- Ambuja Cements Ltd - India
- Eastern Coal Council - USA
- Bayan Resources Tbk. - Indonesia
- Indian Oil Corporation Limited
- Uttam Galva Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Formosa Plastics Group - Taiwan
- Central Electricity Authority - India
- TNB Fuel Sdn Bhd - Malaysia
- Deloitte Consulting - India
- Mintek Dendrill Indonesia
- Essar Steel Hazira Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- The University of Queensland
- MS Steel International - UAE
- VISA Power Limited - India
- Standard Chartered Bank - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Samtan Co., Ltd - South Korea
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement PLC, Thailand
- Marubeni Corporation - India
- Indo Tambangraya Megah - Indonesia
- Port Waratah Coal Services - Australia
- Electricity Generating Authority of Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Indonesian Coal Mining Association
- GMR Energy Limited - India
- Parliament of New Zealand
- Latin American Coal - Colombia
- Banpu Public Company Limited - Thailand
- Lanco Infratech Ltd - India
- Borneo Indobara - Indonesia
- Siam City Cement - Thailand
- OPG Power Generation Pvt Ltd - India
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Renaissance Capital - South Africa
- Indian Energy Exchange, India
- White Energy Company Limited
- Bhoruka Overseas - Indonesia
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Vizag Seaport Private Limited - India
- CIMB Investment Bank - Malaysia
- Sree Jayajothi Cements Limited - India
- Kobexindo Tractors - Indoneisa
- Wilmar Investment Holdings
- Indogreen Group - Indonesia
- International Coal Ventures Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Semirara Mining Corp, Philippines
- PTC India Limited - India
- SN Aboitiz Power Inc, Philippines
- Orica Mining Services - Indonesia
- Salva Resources Pvt Ltd - India
- Eastern Energy - Thailand
- Toyota Tsusho Corporation, Japan
- Rio Tinto Coal - Australia
- Sakthi Sugars Limited - India
- Minerals Council of Australia
- Coastal Gujarat Power Limited - India
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- Bukit Baiduri Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Central Java Power - Indonesia
- IEA Clean Coal Centre - UK
- Bukit Asam (Persero) Tbk - Indonesia
- Thai Mozambique Logistica
- Miang Besar Coal Terminal - Indonesia
- Ind-Barath Power Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Energy Link Ltd, New Zealand
- Interocean Group of Companies - India
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Timah Investasi Mineral - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Kapuas Tunggal Persada - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Madhucon Powers Ltd - India
- Karaikal Port Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Tata Chemicals Ltd - India
- PowerSource Philippines DevCo
- Ministry of Finance - Indonesia
- Sarangani Energy Corporation, Philippines
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Meenaskhi Energy Private Limited - India
- Coal and Oil Company - UAE
- Power Finance Corporation Ltd., India
- Ministry of Transport, Egypt
- Meralco Power Generation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- London Commodity Brokers - England
- Kumho Petrochemical, South Korea
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- Pendopo Energi Batubara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- European Bulk Services B.V. - Netherlands
- Aditya Birla Group - India
- Global Coal Blending Company Limited - Australia
- San Jose City I Power Corp, Philippines
- Simpson Spence & Young - Indonesia
- Therma Luzon, Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Economic Council, Georgia
- Bharathi Cement Corporation - India
- Dalmia Cement Bharat India
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Australian Commodity Traders Exchange
- Carbofer General Trading SA - India
- Riau Bara Harum - Indonesia
- The Treasury - Australian Government
- Global Business Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Romanian Commodities Exchange
- Medco Energi Mining Internasional
- Directorate General of MIneral and Coal - Indonesia
- IHS Mccloskey Coal Group - USA
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- Goldman Sachs - Singapore
- Parry Sugars Refinery, India
- Petron Corporation, Philippines
- Attock Cement Pakistan Limited
- Indika Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- Xindia Steels Limited - India
- Altura Mining Limited, Indonesia
- Mercuria Energy - Indonesia
- Agrawal Coal Company - India
- Heidelberg Cement - Germany
- Baramulti Group, Indonesia
- ICICI Bank Limited - India
- Larsen & Toubro Limited - India
- Electricity Authority, New Zealand
- Barasentosa Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Makarim & Taira - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Aboitiz Power Corporation - Philippines
- ASAPP Information Group - India
- Mjunction Services Limited - India
- Krishnapatnam Port Company Ltd. - India
- Price Waterhouse Coopers - Russia
- McConnell Dowell - Australia
- Energy Development Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Videocon Industries ltd - India
- Malabar Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- Bangladesh Power Developement Board
- Bhatia International Limited - India
- Global Green Power PLC Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Posco Energy - South Korea
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Australian Coal Association
- Straits Asia Resources Limited - Singapore
- Sical Logistics Limited - India
- TeaM Sual Corporation - Philippines
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- Africa Commodities Group - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Metalloyd Limited - United Kingdom
- Planning Commission, India
- Leighton Contractors Pty Ltd - Australia
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